Recent studies have highlighted the importance of inflammation as a contributor to the pathogenesis of a number of chronic disease states such as rheumatoid arthritis, cirrhosis, glomerulosclerosis, inflammatory bowel disease and atherosclerosis. The infiltration of monocytes/macrophages is a characteristic feature seen in chronic inflammatory disease states. Indeed, experimental, clinical, and pathologic studies have established an essential role for the monocyte in the development of atherosclerotic lesions. As such, identification of mechanism(s) regulating monocyte/macrophage activation are of considerable interest. Transforming growth factor beta (TGFb1) is a potent inhibitor of inflammation and immune cell activation. Definitive evidence for this role is derived from the fact that mice deficient in this factor succumb to a systemic inflammatory wasting syndrome. TGFb1 is expressed in human atherosclerotic lesions and its levels correlate inversely with the severity of clinical disease. The mechanism(s) by which TGFb1 is able to inhibit immune cells remains poorly understood. Recently, a family of proteins termed Smads have been identified as effectors of TGFb1 signaling. We hypothesized that members of this family may regulate TGFb1?s inhibitory effects on monocytes. Indeed, we found that one of these factors, termed Smad3, was able to recapitulate the inhibitory properties of TGFb1 with respect to monocyte/macrophage activation. These studies also suggest that inhibition occurs through a novel mechanism involving competition for rate-limiting quantities of critical cellular regulatory factors (co-activator competition). Thus, the goals of this study are to define the role of Smad3 in monocyte biology. First, we will dissect the molecular mechanisms governing Smad3 mediated inhibition in macrophages. Second, we will overexpress Smad3 in macrophages and assess effects on specific effector functions such as elaboration of cytokines, matrix degrading enzymes and lipid uptake. Third, we will assess the effect of Smad3 deficiency on the development of atherosclerosis in mice. Collectively, these studies should provide insight into the role of Smad3 in mononuclear cell biology both in vitro and in vivo. Furthermore, these results may serve as the basis of novel strategies to limit mononuclear cell activation and inflammation in a number of human disease states, including atherosclerosis.